Change of scene, change of mood: Against the backdrop of Salzburg’s dramatic Festungsberg, May gave an impassioned address to EU leaders delineating the Brexit position of Her Majesty’s Government. She made it quite clear that the Chequers proposal, which was devised at a Cabinet off-site meeting held at the prime minister’s country residence, could work. The proposal advocated free movement for goods yet favored a different regime for services; it also disavowed the free movement of people.
It came as little surprise to seasoned observers that this stance would, in the end, not fly with May’s EU peers. The breaking points are relatively clear cut. In its treaty of Rome, the EU laid down four freedoms that are indivisible and inalienable: They are the freedom of movement of goods, services, capital and people.
The free movement of goods was especially important in the context of the Northern Irish border. For centuries, Ulster had been a troubled region within the UK, but the Good Friday Agreement of 1997 brought peace. Giving up on border checks between the Republic and Northern Ireland was very important in that context. Therefore, any new border control may put at stake more than free trade; it may endanger peace itself.
The EU’s compromise proposal was to leave Northern Ireland inside the single market while the rest of the UK exited. This does not work from a British perspective. Ulster is just as irrevocably and unalienably a part of the UK as the four freedoms are indivisible from an EU perspective. Therefore May cannot tolerate a hard border between Northern Ireland and the rest of the UK, which would be the result of the EU proposal. The fact that May’s minority government lives by the grace of 10 votes from its ally, the hard-line Democratic Unionist Party, only adds strength to that imperative.
We have a case here of an irresistible force meeting an immovable object. However, it should have been clear to May that, despite the dulcet tones of the likes of Juncker and Barnier, the integrity of the single market has always been a red line for the EU.
It was somewhat courageous of the UK PM to suggest that the Chequers proposal was as good as it gets, and that there was no room for negotiation. The Brexit negotiations are precisely that: Negotiations. This implies give and take from both sides.
One can sympathise with May, as she has to contend with mounting opposition from within her own party from hard Brexiteers like Boris Johnson and Jacob Rees-Mogg. She also has a Conservative Party conference coming up next week where her position is not as secure as she would like it to be.
If the UK crashes out of the EU without an agreement, it would be tantamount to an economic self-harming exercise of epic proportions. We can only hope that the country’s leaders do not lose sight of what is in the nation’s best interests.
Cornelia Meyer
May cut an isolated figure in Salzburg and the general tone of the discourse seemed harsh. At the end, European Council President Donald Tusk posted a picture on social media offering May a cake but with no cherries, reinforcing that there is to be no cherry-picking as far as the single market or the customs union are concerned.
Back in London, May held a press conference stating that she had always treated the EU with respect throughout these Brexit negotiations and that she now demanded the same level of respect in return. Oddly enough, the Salzburg episode might help May deal with her hard-line party members at the upcoming conference. It was probably good for her survival chances to be seen as “standing up” to the country’s “nemesis” in the EU.
Be that as it may, there is only a matter of weeks left to reach an agreement. Crashing out without a deal is simply not an option, as it would leave businesses and the economy in Britain exposed and vulnerable. The government has been warned by foreign investors and UK businesses alike that failing to come to an agreement would result in less investment and fewer jobs. It may be that the EU and May are playing an elaborate game of cloak and dagger and that, in the end and at the last moment, some sort of a compromise can be found.
However, they are playing with fire. If the UK crashes out of the EU without an agreement, it would be tantamount to an economic self-harming exercise of epic proportions. We can only hope that the country’s leaders do not lose sight of what is in the nation’s best interests.
- Cornelia Meyer is a business consultant, macro-economist and energy expert. Twitter: @MeyerResources
